HSBC Holdings plc (NYSE:HSBC) has revealed that its blockchain-powered platform has managed to cut costs for the foreign exchange (FOREX) trade settlement by 25%. According to the chief operating officer of forex cash trading and risk management at HSBC, Mark Williamson, the bank through its proprietary blockchain solution known as “FX Everywhere” is capable of processing between 3,500 and 5,000 trades per day.
Blockchain Working the Magic for HSBC
Compared with the traditional methods, the British multinational banking as well as financial services holding company has been able to save 25% forex trading cost using a blockchain-powered platform. It’s merely a month ago when the bank announced settling over $25o billion in transactions by using its FX Everywhere platform.
During the time, it was said that the bank settled three million foreign exchange transactions with a further 150,000 payments that were over the digital ledger system which it has used for the past one year. According to Mark Williamson, the process is currently able to settle trades worth $350 billion daily.
The bank is indeed going at a pace as Williamson puts it and it can demonstrate that it’s not a one-off proof of concept or maybe one or two trades. Even though the data for overall forex trades being settled by traditional methods are not given, the FX Everywhere platform has represented a more significant proportion.
Blockchain Technology the Way for Financial Institutions
For some time now, blockchain technology has been on the headlines with the financial service industry being slow in making any use of it with only a few getting beyond the testing phase. Most of those companies have a concern over security, regulation as well as the impact on the existing systems.
However, now the news from HSBC might give the industry a new approach as a major bank has its positive story to tell. Perhaps, blockchain technology settles transactions without third-party checks and hence will transform the industries from finance to real estate while eliminating cumbersome as well as inefficient processes. For now, HSBC is a step ahead with their FX Everywhere platform and only time will tell whether other major banks will be following suit.
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